CAPE TOWN, Oct. 24 (Xinhua) -- South Africa must restore good governance and fight corruption in all of its forms so as to ensure sound economic growth, Finance Minister Tito Mboweni said on Wednesday.
Delivering his maiden Medium Term Budget Policy Statement (MTBPS) in Parliament, the newly-appointed finance minister pointed to a number of cases in which public funds have been diverted to benefit a few greedy individuals.
"There are such many cases where projects are manufactured, contracts are awarded corruptly and construction costs are inflated, or where corrupt practices have taken hold in the provision of land use rights," he said.
All South Africans share the pain of poorly performing municipalities: potholes, broken street lights, roads that flood when it rains, and challenges with electricity, Mboweni said.
"We are acutely aware that some municipalities are facing serious capacity constraints in executing their plans and programs," he said.
The Auditor-General has consistently shared audit messages that emphasize the importance of accountability in the management of municipal affairs, said Mboweni.
This year, 113 municipalities adopted unfunded budgets, up from 83 in the previous year. Municipalities owe more than 23 billion rand (about 1.62 billion U.S. dollars) to service providers, mainly to electricity utility Eskom and water service agencies, according to Mboweni.
In many cases, the financial challenges faced by municipalities are a reflection of weaknesses in governance, or even fraud and outright corruption, he said.
The funds lost by municipalities in the collapse of the VBS Mutual Bank offer a dramatic illustration of how greed and corruption impacts the achievement of developmental objectives, Mboweni said.
In the VBS Mutual Bank scandal, up to 900 million rand (about 64 million U.S. dollars) in deposits at the bank could not be traced due to alleged irregularities. Much of the money was deposited by municipalities, a preliminary investigation shows.
"We can spend our money better. Too much money goes missing," Mboweni said.
South Africans correctly expect more from their government and they are right to expect that their money is spent wisely and productively, and goes to meeting their basic needs, Mboweni stressed.
